Spectrum Brands Misses Q3 Expectations

Spectrum Brands Holdings, Inc. SPB reported weaker-than-expected results for the third quarter. The Middleton, Wisconsin-based company reported a quarterly profit of $26.5 million, or $0.44 per share, versus a year-ago profit of $47.9 million, or $0.90 per share, in the year-ago period. Excluding certain items, the company's adjusted earnings came in at $1.13 per share. Its revenue rose 11 percent to $1.31 billion from $1.18 billion. However, analysts were estimating earnings of $1.16 per share on revenue of $1.33 billion. The average estimate among 6 Estimize users was for earnings of $1.16 per share and revenue of $1.33 billion. Sales for the company's Global Pet Supplies business gained to $219.3 million from $159.8 million, while Global Batteries & Appliances segment sales fell to $553.0 million from $595.7 million. Sales for Hardware & Home Improvement segment rose 5.6 percent year-over-year to $331.4 million, while the Home and Garden segment sales fell to $108.3 million from $109.0 million. Its gross profit margin expanded to 35.7 percent from 34.9 percent. Operating expenses increased to $333.0 million in the fourth quarter, versus $295.4 million in the year-ago period. Its adjusted EBITDA climbed 22.8 percent to $229.3 million in the fourth quarter. "Looking to fiscal 2016, we expect healthy top and bottom-line growth again from a mix of new products, new customers, distribution and market share gains, increased cross-selling, geographic expansion and continuous improvement savings along with strong expense controls," Andreas Rouvé, Chief Executive Officer of Spectrum Brands Holdings said. "At current spot rates, we face continuing negative foreign currency headwinds, primarily in the first half of the year. We have plans in place to offset these headwinds as in fiscal 2015." For 2016 fiscal year, Spectrum Brands projects sales growth in the high-single-digit range, versus sales of $4.69 billion in 2015. Spectrum Brands shares rose 1.88 percent to close at $92.45 yesterday.